Kelowna Remuneration and Payment Report 2008

Item 6.2 - 2008 Annual Report.pdf (5583kb) (2009-06-25)

Spending habits questioned

By Jennifer Smith - Vernon Morning Star - June 26, 2008

Four nights at a Vancouver waterfront hotel – $976. Parking – $140. Meals and mileage – $1,038. Chance to schmooze with senior government officials and possibly gain grants and funding for your hometown – priceless.

That’s the rationale for Coldstream Coun. Glen Taylor, who has been put in the hot seat over his $6,720 in expenses – making him the top spender at Coldstream council. Since expense numbers were approved by council earlier this month, Coldstream resident John Hegler has dug up some additional information and breakdowns on just what his elected officials are spending taxpayer’s money on. Putting Coldstream Coun. Glen Taylor primarily on the spot at Monday’s council meeting, Hegler questioned his $6,720 in expenses for 2007, plus the $3,292 he earned for attending 25 meetings. He used one particular trip on Taylor’s expense list to make his point, the Union of B.C. Municipalities conference in Vancouver in September. Taylor’s expenses for the trip, including accommodation, registration, parking, per diem and mileage totalled $2,798. “The mayor’s total expenses for the whole year were only $2,500,” said Hegler. While Taylor was questioned on his expenses, Hegler did commend Mayor Gary Corner for keeping his costs minimal. “To me as a taxpayer that’s totally acceptable and fiscally responsible on your part.” Hegler also praised Coun. Doug Dirk for having zero expenses, as he did not attend any conferences.

“Mr. Dirk, you didn’t even buy a package of gum, you had zero expenses. Commendable,” said Hegler. On the other hand, Coun. Mary Malerby was also put on the spot as her expenses for the same UBCM trip actually topped Taylor’s. “Mrs. Malerby stayed in the same hotel, same everything and she charged $386 more. That’s a little strange, she must have stayed in the princess suite,” said Hegler. But in fact, Malerby stayed in the same type of room as the others, nothing fancy or “princess”-like, she said. “I didn’t even have a view, I wasn’t looking at the water,” said Malerby of her room which overlooked a nearby Tim Hortons. The reason for her extra expenses is due to the fact that she spent an extra night in Vancouver. Although she stayed at her daughter’s house, thinking she was saving the district money, the hotel room was booked in advance and the hotel would not refund Coldstream. Still, Hegler is convinced that some councillors are spending too freely with taxpayer’s dollars. “All this money that these taxpayers are paying goes into a great big pot...and people like Taylor and Malerby keep dipping into this pot.” It’s not just the expenses, it’s the conferences and workshops in general that Hegler disagrees with. “I’ve been to conference after conference and I can assure you that the value is very limited,” he said, adding that councillors like Jim Garlick and Bill Firman are doing a great job despite not attending all the conferences. “I encourage you to take a look at your expenses and who you send to conferences.” Taylor defends the need to attend such events as UBCM, the Federation of Canadian Municipalities and the Southern Interior Local Government Association. “I agree sometimes you don’t get much out of some workshops but sometimes you do and you can bring it back and share it with your council,” said Taylor, adding that the number of councillors allowed to go to conferences has been scaled back in the past from all seven to three.

Finance Committee Meeting at 1 PM

No idea of agenda for this meeting but it may be more of preparation for the Annual Report meeting that is due by June 30. This annual report that includes reviews of past annual report objectives and goals and a presentation of this years goals as well as other info listed below. As there must be a minimum of 2 weeks for advertising of this meeting it would appear that Council will have to approve the Annual report after much thoughtful debate at one of the next 2 council meetings.

Last Years Annual Report Included:

• Consolidated Financial Statements for 2006.
  
• 2006 Permissive Tax Exemptions
• Summary of 2006 Year End Financial Results.
• 2005 Goal and Objectives Final Report (35 goals in total)
• 2006 Goals and Objectives Restated (19 goals in total)
• 2007 Goals and Objectives (5 goals in total)
• 2006 Schedule of Council Remuneration and Expenses
• 2006 Schedule of Employee Remuneration over $75,000 and expenses.
• 2006 Vendors paid in excess of $25,000

Consultants’ fees raise alarm bells at city hall

Vernon Morningstar: 10/24

A Vernon councillor wonders why so much work is being handed over to consultants.Council learned from staff Monday that $909,000 was spent on consultants in 2006.“Wouldn’t some of this work be better served by expanding our staff,” said Coun. Pat Cochrane.Staff will do a break-down on the cost, but chief administrative officer Leon Gous says some of the $909,000 went for capital design work, items that would not normally be done in-house.

New home found for feral rabbit population

The issue of housing Vernon’s feral rabbit population has been resolved temporarily.The animals will be kept in-term in a horse stall at Kin Race Track instead of at a private residence.
Some neighbours of the residence had complained about an odour issue.Coun. Juliette Cunningham believes the new site will benefit Rabbit Rescue, which traps the feral rabbits and has them spayed and neutered.“Venture Training wants to help look after the animals so this will work well,” she said of Venture Training’s location across the street from the race track.

City Hall responds to some of the questions from Sept 24 Annual Report public input !

Agenda Package 1 - 4.95MB Oct 9 .(p.13- 21)
AND FURTHER, that the record of the Public Input for the 2006 Annual Report, held on September 24, 2007, be received. (P. 13) (These are Don Quixote written submission at the public input. (Appears that Council or Staff will make no written reply or comments !)

Agenda Package 1 - 14.1MB P 59-61 (75-77) Oct. 22
RESPONSE TO QUESTIONS RAISED AT PUBLIC INPUT SESSION (P. 59)
B. Memo dated October 10, 2007, from Mr. Kevin Bertles, Manager, Finance, re: Response to the Questions Raised by Mr. R. Spears at the Public Input Session.

Don Quixote NOTE: Above links are for my submission re the Annual Report on Sept. 24 and the answers from the Finance Manager that will come on Monday Oct.22. The initial report has the correct spelling of my surname while the reply has the incorrect spelling. That trivial matter aside I will comment on the responses that will be forthcoming on Monday:

• A new building bylaw with a full report of building permit values as compared to market values is welcomed. The sooner the better.
• The library paying 1/3 of the 31,828.14 for the MQN Architects study is acknowledged.
• RCMP reserve question: I would hope that future transfers to and from this reserve are made in a more open and apparent manner. I'm sure the numbers could be revealed to demonstrate the correctness of this number but the actual resolutions in open Council to authorize transfers are convoluted and hazy.
  
• Airport operating loss in 2006 of $189,005 confirmed by financial statements. This does not indicate whether the $18,381 run through the City's books in Dec/06 are part of this loss but I suspect not. (They have been included in my final figure of $6528 surplus next sentence.) Left unanswered if the final 3 year surplus of $6528 after amortization is backed out is transferred to the City's books in 2007 ?
• The Airport Capital reserve transferred is $47,322.52. The last reconciliation of this amount in late 2006 was $113,333. Difference of $66,010.48. What capital projects were not accounted for in original list? Original final reconciliation can be found at http://vernonblog.blogspot.com/2007/01/blog-post_05.html and http://vernonblog.blogspot.com/2007/01/airport-money-found-but-questions.html
• There is a staff purchase program at London Drugs??? $38,895.33
• Consultants list is attached and complete. A brief description of services performed.such as infrastructure engineering, OCP, Library facilitator etc. would be better. Total of $909,909.17 was a surprise!
• The Fringe load variance accrual of $490,000 relates solely to 2006 and was put in a fringe load variance reserve. When 2007 figures are revealed then the overhead variance percentage may have to be re-adjusted? How will this reserve be used in the future?

Reports online for Public Input Meeting Today at 5:30. Find Out how the City Could accumulate $1/2 million dollars in a Fringe Load Variance Reserve !

• 2006 Financial Statements - 7.9MB
• 2006 Detailed Variance Analysis - 1.18MB
• 2006 Airport Statements - 1.46MB

The detailed variance reports explains the operating surplus of $1,516,135 and how it came about for 2006. Where it was temporary placed in reserves can be found at Page 14 of this report.(see excerpt below) These General reserve balances at end of 2006 of $15,736,381 ($11,419,146 in 2005) do not include the Statutory DCC's etc. The DCC Balanace at 2006 year end can be found on Page 11 of the Financial statements and sits at $12,660,771. ($10,467,222 in 2005)

Temporary resting place of $1,516,135 2006 operating Surplus:
Development excess revenue Reserve $533,000
Transit Expansion Reserve $200,000
Infrastructure Reserve $293,135
Fringe Load Variance Reserve $490,000

What the Hell is a Fringe Load Variance Reserve ?

A variance account is a cost accounting concept that is used to establish a costing method that simplifies and reduces the number of accounting entries that have to be made for an recurring expense. Simply put the City of Vernon has decided at the start of the year that for every dollar of salary cost that is incurred by a department there will be 22% of overhead charged on that dollar to that department. (If the department recovers these costs from an outside agency, say NORD they charge this standard overhead charge for every dollar of salary billed etc.)

This standard overhead charge is debited to these departments and the offset or credit is put in the Fringe Load Variance Account. Now when the bills come in for the fringe benefits whether they be medical,dental.uic, cpp or other authorized expenses, this account is debited for the actual expenses billed and the suppliers are paid.

Basically the difference between the standard 22% estimated overhead (Credits ) and the actual billed costs (Debits) are put in the account. Standard costs are Compared to actual costs at the end of each accounting period and a variance calculated. Hopefully the balance is a credit balance which would indicate that the 22% overhead charge is in excess of actual. If the credit is material and all the bills are in and the period is complete it may be necessary to recalculate the 22% overhead charge downward. Regardless the credit must be flatten out and credited to revenue or a reserve for the same period.

In Vernon’s case the credit amounted to $490,000 and was transferred to the now infamous FRINGE LOAD VARIANCE RESERVE.

• For what period of time was this $490,000 for. Did it accumulate in 2006 only or was it spread over a longer period?This determination of time is necessary so a more correct overhead rate can be utilized in the future.
• What is the balance in this variance account in 2007 ?

A Public Input meeting, for the 2006 Annual Report, PUBLIC INPUT to Convert Residential Rental Units to Strata Titled Properties and New Web page

http://www.vernon.ca/news/wftc/070909.pdf
A Public Input meeting, for the 2006 Annual Report, will be held on Monday, September 24th, 2007 commencing at 5:30 p.m., in the City Hall Council Chamber.

The purpose of the public input meeting is to provide the public with an opportunity for input on the City of Vernon’s Annual Municipal Report. This report includes information on the municipal objectives approved by Council for 2006 and includes a summary statement and a series of milestones, phasing, and requirements for anticipated completion of these objectives, as well as the City’s annual audited financial statements, list of tax exempt properties, and the annual remuneration of Council. If you with to review the 2006 Annual Report, it is posted on the City’s website at www.vernon.ca or you may attend City Hall and pick up a package. Questions relating to the Annual Report may be directed to Mr. Kevin Bertles, Manager, Finance, at 550-3550.
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REQUEST FOR PUBLIC INPUT Approval to Convert Residential Rental Units to Strata Titled Properties
Currently Vernon Council has a policy in place indicating they will not approve the conversion of existing rental units in a residential building (of more than 4 units) to strata titled units if the rental vacancy rate (determined by CMHC) exceeds 2%. The current vacancy rate for rental units in buildings with 3 or more units is 0.9% therefore the strata conversion of existing buildings with more than 4 units will not be approved. Strata conversions do not apply to new buildings that have not been occupied for a specifi ed period. Such buildings can be strata titled without requiring Council approval. Council passed a resolution stating they will not consider strata conversion applications for sites with less than 5 units until they have received community input concerning the impact residential strata conversions have on rental housing. Council requests your input on whether the current policy should be revised, retained or repealed. Please submit your input prior to September 14th, 2007 and to the following: City of Vernon, 3400 - 31st Street, Vernon, BC V1T 5E6, Attn: Dale Rintoul, Planner. Fax: 545-5309, email: drintoul@vernon.ca, phone 550-3575.
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ATTENTION: VERNON DEVELOPERS
The City of Vernon is developing a web page just for Vernon developments. We wish to assist these developments by providing direct links to their websites from www.vernon.ca. With over 1.1 million hits a month this would assist the public and investors in locating and investigating your developments. If interested, please provide the development name, website and contact information to webadmin@vernon.ca. If you don’t have one, we will list your contact information in the absence of the website link.

Financial reports posted on City's website

Airport Financials year ending Dec. 31, 2006

City of Vernon Annual Report and financial statements for 2006

Still awaiting:

• 2006 detailed variance report
• 2007-2011 5 year financial Plan.
  

A lesson in goal-setting

http://www.dailycourier.ca/
Scott Neufeld is the managing editor of the Vernon Daily Courier.

A quick scan of the city’s annual report released late last month shows that everything is on the rise. Financial assets are up, revenues are up, expenditures up. But one thing that council seems to be cutting back on is goal-setting. Back in 2005 the previous council set an ambitious 35 objectives to tackle. The new council cut that down to 19 for last year. This year, however, council has set just five goals for themselves. So are city councillors already running out of ideas? Have they lost some motivation?

Their objectives for the year include reviewing the Official Community Plan, addressing public safety concerns, improving road infrastructure, improving NORD/Coldstream relations and improving transit service. Given the lack of goals, the city appears close to achieving some of them. The OCP review is well underway and the city is finishing up its major roads projects for the year which included 25th Avenue, the Bella Vista Road intersection and the Middleton Way extension. They’ve achieved part of their public safety objective by hiring more bylaw officers. But their goal to initiate a pilot program “using private security personnel in public areas” is puzzling. It appears they allowed the Downtown Vernon Association to spearhead the program but are now refusing to pay for it. That’s one way of completing your goals. Get someone else to do them for you.

As for their goal of improving relations with surrounding municipalities it’s difficult to assess if they’ve made any progress on that front. Given all the turmoil over governance changes, regional district remuneration and the ongoing service review, Vernon has done little to endear itself to its neighbours. By aiming low, however, the city will likely reach its goals. But before council pats themselves on the back for a job well done, they should consider all of the work left to do.

There’s still no clear plan to deal with affordable housing, development continues to be haphazard, there are no new parks in the city, transit service has not been improved, the issue of the library/art gallery/civic complex has not been dealt with. Add to that list the need for cleaning up the north entrance to the city, the lack of a homeless shelter for women and there’s a long list of objectives for council to undertake. Instead, they seem to have decided to shy away from the big issues, preferring to tackle the easy ones.

Not that there’s anything wrong with that. It’s fine for council to show a lack of innovation and a lack of grit when it comes to taking on the big issues in the city. But for a council whose identity is currently defined by their decision to bypass the referendum process, they might want to add more objectives. This is not to say that council is taking it easy. By all accounts they put in long hours and are active in the community. However, councillors are judged by what they accomplish not by the volume of studies they add to the city’s archives. So far this council’s worth will be weighed in paper, not in their actual impact on the city.

Perhaps council is making serious headway in all of their in camera meetings – maybe not. Maybe what they need is an infusion of ingenuity from the public. They seem to have run out of things to accomplish so it’s up to the voters to contact their council and give them a few ideas of what to do. It’s not too late. The next election is still more than a year away and council can still set more lofty objectives. They need to start setting the bar higher because Vernon deserves better than another five-goal year.

2006 Annual Report Public INPUT Meeting may be delayed until Newspaper advertising made in proper manner ?

Annual Municipal Report and Interpretation
Requirements for the Annual Report due before June 30th, 2006 in accordance with Section 98 of the Community Charter.

Once completed, the annual report must be made available for public inspection. After making the report public, council must wait a minimum of two weeks before holding an annual meeting on the report. This provides citizens with time to review the annual report, ask questions and prepare submissions. Council must give notice of the date, time and place of the annual meeting in accordance with the Community Charter's requirements for public notice.

Regarding the first point, in accordance with section 25(4) of the Interpretation Act, if the calculation of time is expressed as "at least" a number of days, the first and last days must be excluded from the count. For example, if the public meeting is scheduled for Thursday, June 29th, you would first exclude the date of the meeting (June 29th) and count back 14 days from June 28th to June 15th. You then count back a further day to June 14th (because you must also exclude the first day in the time cycle). Or, simply count back 16 days from the June 29th public meeting deadline to determine the deadline for making the report available for public inspection.

Regarding the second point, notice of the public meeting to present the Annual Report (deadline on June 29th) must be posted in the public notice place and published in a newspaper once each week for two consecutive weeks. For the purposes of this requirement a newspaper is defined as a publication or local periodical that contains items of news and advertising and is distributed at least weekly in the municipality.
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Don Quixote Note: I had hoped to see this report on Next Mondays Agenda and technically it was available in last meeting's agenda package on Friday on the City's website but it had not being accepted by the council. At the Monday meeting it was accepted and a date of Sept. 10 was proposed for public Input if memory serves me correct.

However, there has been no advertisements in the local Newspapers that I saw yet so it would appear that this meeting that was required by June 30 would have to be delayed until the necessary statutory advertisements were made.

Also as I mentioned in my Aug 29 posting that you could pickup annual report at City Hall and what it contained : Vernon 2006 Annual Report Available for Pickup at City Hall !

I also observed that we were still waiting for the following to be posted online ASAP so we could analyzed the annual report and make meaningful public input:

• Detailed Variance report 2006
• 2006 Financial Statements (Full)
  
• 2007-2011 five year plan adopted in early Spring.

In the Annual report you will note that Black Press (Morningstar) had a 2006 bill of $105,736 compared to a 2005 bill in an election year of only $85,796. (23.2% increase) while the fledging Vernon Courier failed to meet the $25,000 threshold in either year. ??

Scorecard On Vernon's 2007 Goals !

CLICK ON IMAGE TO ENLARGE

Vernon 2006 Annual Report Available for Pickup at City Hall !

The 2006 Annual Report can be picked up at City Hall. A public input session for comments on this report will be advertised shortly probably for Sept 10.

This Report Contains:

• Consolidated Financial Statements for 2006. (Full detailed financials should be posted on City's web page shortly.)
• 2006 Permissive Tax Exemptions
• Summary of 2006 Year End Financial Results.
• 2005 Goal and Objectives Final Report (35 goals in total)
• 2006 Goals and Objectives Restated (19 goals in total)
• 2007 Goals and Objectives (5 goals in total)
• 2006 Schedule of Council Remuneration and Expenses
• 2006 Schedule of Employee Remuneration over $75,000 and expenses.
• 2006 Vendors paid in excess of $25,000

Shortly online will be posted:

• Detailed Variance report 2006
• 2006 Financial Statements
• 2007-2011 five year plan adopted in early Spring.